More like $175 a month from 15 - 60 :)

Numbers put in 0, 175, 552 (46 years * 12 months in a year) @ 8%

And that gives you

$1001835.45

Though do it for an additional 5 years (612 months) and you end up with another 500,000.... man compound interest is awesome

http://www.patrickschneider.com/compound_interest_calculator.php 

http://moneycentral.msn.com/content/investing/startinvesting/p73751.asp <- neat little article talking about if you invest $2,000 a year while you are a teenager for 4 years

Small Excerpt from article:

A million dollars. It has such a nice sound.

So let me show you how four summer jobs can become your first million.

Let's suppose that you are 16 years old, in high school, and willing to work. Let's also suppose that you can clear about $2,000 over the course of a summer, if only because a doting grandparent puts money in the Roth while you take your earnings to school. If you invest in a Roth IRA, it will grow, tax-free, for as long as you have the account. All withdrawals from the account after age 59 1/2 will be tax-free.

If your money is invested in common stocks and you achieve the average compound annual rate on large-capitalization U.S. stocks, 10.7%, your account will grow to $9,378 at the end of the fourth year. You will be 20 years old. Invested in the same way, with no additional savings, the account will grow to:

• $25,917 by the time you are 30
• $71,625 by the time you are 40
• $197,943 by the time you are 50
• $547,037 by the time you are 60
• And $1,114,423 by the time you are 67

And you will have started and finished all of your saving before turning age 21.

I never understood this. I once asked some co-workers "why do you invest?" and then they said "o make more money from the investments." Then I asked, "so what do you do with that money?" and they just said "invest it again for more money."

Let me tell you, they were a smart bunch with masters and PhDs all. They also had unpaid houses, cars, however not that much debt outside of that. That said, money is not for investing and saving. Once you have that cushion for the 7 year WTF moment (statistically something horrible will happen to every 7 years that will require a bunch of money to be used up), the rest should be your spending money.

Nah, you don't understand

The idea is that I want to be able to build up my stocks until dividend payments will be able to match my current quality of life, and then I will stop working.

I invest money so I can retire someday. So I can sit around and read books and go on vacation and play video games and go to the gym while all of my bills are just taken care of.

Who ever heard of a retired guy playing games and going to the gym?

I had this in an edit but you ebat me to it so I'll jsut say it here:

The way I ensured some safty, and my retirement, is by putting $50 a month at a very young age in a mutual fund, the ones with very low returns but that skyrocket exponentially with time. Other than that, I have enjoyed my life by going abroad to interesting places almost every year (this year is the first in a long long time where I am stuck in the US for the whole year) and what else I have goes to making my domestic life more fun. My account is also happily growing and at around 35 I might even stop putting new money in it since it just won't matter.

I don't know how i is for a later age, but just throw small amounts of money in there, but do it religiously, and you should be fine. By the way, the lipstick industry is the most stable industry and is literally depression-proof.

vlad -

Investing should come after your major unsecured bills have been paid for. I don't understand why you say 'money isn't for investing/saving'.....Yes it is. You should have a decent investment plan for retirement that is outside of the horribad pensions that the US government mandates you to have (which will either not exist when your older, or be nearly useless like my dad's is).

How old are your co-workers, vlad? I'd imagine that if they are younger than 50, they would want to keep re-investing until they reach retirement, and have a large retirement fund set back.

@Khuurta - I wasn't suggesting that 89% in 2 years was sustainable. They are looking to return about 20% per year from now on. That is still well above most other ways you can invest, outside of being a venture capitalist. The average rate of return on CDs and other such safe investments are usually in the range of 2-4% which is barely above inflation...

Find a good person to take care of your investments like I have, and you'll do well.

Well, I guess I understand that, but I don't know what it's going to be like to invest in an American company from in Canada. I start from where I can.

Right now I'm going to buy stock in the Bank of Montreal and set up a DRiP and SPP - I'll pay money into it whenever I can, and let the dividends buy me more stocks. Seems like a pretty safe plan with BMO, and it doesn't require me to have anyone handle my money... yet. I will, though, when I have more money to invest.

$50 a month at 15 and more now in T Row Price. I also put a bunch of money in just as everything went to hell back in 2008/2009 so I am expecting faster returns on that money. It's slow, but once you start early you are set and done and you can spend your money as you see fit AND have perfectly fine retirement.

My co workers were indeed younger than 50, the oldest one was around 45 and he was the oldest by a very good. In fact he was probably the one saving up the least. As for money is for saving/investing, it really is not, because there is no point in doing some things when old. You can't go trekking across the Alps, you can't ski, you can't go and get yourself drunk 24/7 for 5 days straight. There is a ridiculous amount of activities that get cut as a person ages, and that number only grows after 50 at a faster rate. You rest in your retirement and take the less expensive, calmer vacations when retired. You go on the high spending and do stupid things when you are young.

Basically, money is not an end in and of itself, you make money to enjoy your life. If the money is sitting in a bank, then you are probably not enjoying it very much whiel staring at the amount on your computer screen.

It's important to know what you're doing in the share market, diversification is key. If you're going to buy shares in a big bank then you should buy also buy shares in something like the health sector or maybe in mining to counter balance the bank. Ideally you should have a portfolio of around 10 - 15 different shares and don't be afraid to look overseas either.

I'm Australian, our share market is worth 2% of the world total share market yet ours outperforms the world index by a little over 1% per annum. This doesn't mean Aussies shouldn't look overseas though, as you don't know what's going to happen in the future.

Shares have a bad reputation due to the media coverage of market crashes etc, if you have a well diversified portfolio though, you actually cannot lose. even if you make losses in the first few years, studies have shown that over a period of 20 years, you WILL make a return. Also think about this; if you had invested $1000 in the Australian All Ords 30 years ago, it'd be worth $55,000 today (I don't know much about overseas markets but I'd assume you'd get similar returns).

I've deferred from university so that I can work for 9 months, build up savings of around $20,000 and put $10,000 into the share market and the rest spent on living and a car (I'm 19, live at home still so I can afford to save).

It's important to start now, I'm not really thinking about my retirement yet but wealth building in general.. The hard part about it all is being able to afford to save that amount of money in such a short amount of time and not spending it all as really it's all extra income, it's not vital to my living arrangements etc.

Also have a plan, you want to put in a bit of your weekly income into your shares if you want to make a substantial return. It doesn't have to be a huge amount, say 5% if you can afford it, even 2% will make a huge difference for an investment period of 25 years or more.


Also of note: The share market outperforms ALL other investment types, whether it be residential or commercial property, managed funds, hedged funds, government bonds and high interest accounts. So it's the one to go for if you're only going to pick the one. Again, diversification is key and having money in more than one asset class will only lessen the risk further (remember though as I said, if you're picking top quality shares in companies with no debt etc then you won't lose out in the long run).

That's some good advice, puffy. I do intend to invest in a few more companies - get a few hundred shares in four or five companies - but right now I'm starting with a bank because the BMO in particular has paid out uninterrupted dividends for 180 years, which is longer tan Canada has existed as a country. You don't get safer in terms of share investments.

It's a potentially exciting start.